A site currently promoting awareness and debate of how the poorest students in Scotland face the highest government debts: "seems to return to this issue again and again…. " Michael Russell, former Cabinet Secretary for Education, April 2014

Labour put student grants back on the political agenda in Scotland

March 9, 2015

At the weekend the Scottish Labour Leader, Jim Murphy MP, announced that should the party win the next elections at Holyrood in 2016, it would invest £58 million to restore cuts made to student grants under the present Scottish government. Those cuts, and their regressive effects on the distribution of student debt, have been detailed elsewhere on this site. The announcement comes soon after one on free tuition, which prompted a post here about priorities. By coming out now on grants, Labour has restored some welcome balance to their position and brought grants back into Scottish politics as a topic for debate.

£58 million is a serious investment here. It not only restores the cut made in 2013-14 (just over £35m), it takes spending on grants back closer to the sort of levels which held before the Scottish government first started freezing and cutting grant, particularly from 2011.

Labour has said this would be funded by the consequential which Scotland would get if a UK Labour government was in a position to reduce fees at Westminster (see here). The fee reduction is planned to take effect in 2016, and to apply to all students in the system, so the consequential should come in full, without phasing.

Jim Murphy gave one very precise indication of what they will do with this – put the maximum Young Student Bursary (YSB) back to where it would have been without the 2013 cut. He gave a figure of £2,792, compared to its current £1,750. With the election in May 2016, it would be very difficult to revamp the SAAS systems in time for that academic year – but there might be scope to do something on one-off temporary terms, even that quickly.

The total investment planned here is large enough to extend beyond restoring YSB at its pre-cut level.

Here are some good things which could be done with the likely headroom in the £58 million.

Restore YSB a bit more. Had it not been frozen from 2010, the maximum value would now be nearer £3,000. Any improvement here will help bring down how far poorer students are much more reliant on loan than better off ones.

Revisit the “simplification” of the system which has led to levels of support falling away in sharp steps at certain incomes: smooth in the new higher grant without repeating this – whether in smaller steps or by a return to a taper.

Look again at the position of “independent ” (ie mature ) students. Scotland alone in the UK puts these on a lower grant rate (just £750 a year) and it is not defensible: prior to 1998, they got more than other students. There was at least a technical defence for their lack of access to the main grant when they were also exempt from the graduate endowment – but that is long gone. Many mature students are not all that old. They only need to be over 25, married/in a civil partnership/living with a partner, have a dependent child or have been self-supporting from earnings for 3 years – so some will be in their early and mid- 20’s. They will include a lot of people who for various reasons were not able to tread the primrose path straight from school to university. I hope Labour will look again at their treatment. They are expensive to fund precisely because they tend to be relatively poor. One possibility would be to start by looking at the younger ones in this group. The older students are, the less likely their loan is to be repaid before it is written off. For someone in their twenties, the grant/loan split will tend to matter more. Simply having a single income-related bursary for all students under a certain age would be a possibility. The classification of young/independent will still matter technically, as it determines whether it is relevant to look at parental income: but it needn’t matter for the choice of grant scheme. Young people coming out of care are technically classed as independent, but put on YSB until they are 23 (while we’re at, why not 25?).

Extend the upper threshold for grant, which would now now be around £37,000 if it had not been frozen so long. It is around £42,000 in England and Northern Ireland and £50,000 in Wales. Scotland’s living cost support (all loan) at incomes between £34,000 and £45,000 is pretty poor for those living away from home, compared to other parts of the UK. That’s partly because the other UK nations give out grant to this group. Giving them access to more loan may be an unavoidable part of any solution here – but drawing the grant out to nearer £40,000 would be worth considering – and would avoid a choice between an even starker cliff edge in support at £34,000 under a higher grant system, or people at the tail end ending up with less than the £500 they get now.

Provide more help for those leaving Scotland to study. As I argued here, the £1,820 flat-rate SAAS fee grant could be easily and relatively cheaply converted into an allowance available to all students, not just those who study in Scotland. Indeed, with Labour’s parallel announcement of a £1,600 one-off payment for 18 and 19 year olds who don’t go to college or university, if nothing more is done for Scots going elsewhere in the UK to study, this group will be the only ones to get absolutely nothing. It’s a common prejudice that border crossers are mainly private school pupils off to Oxbridge. But the data shows a much more complex picture (and even it didn’t, these would still be young Scots we’d be willing to fund a lot more generously if they went to a relatively selective university here). To save our system from being engulfed by a parochial miasma, it would be good to find some cash for border crossers – all of them, if we were replicating the approach to fees in Scotland, but at least the ones entitled to a grant, if not.

While we’re here, someone needs to look harder at the situation of young people leaving care. Extra grant may not be the right answer, if they don’t want to their status as a care leaver to be obvious – but a debt write-off scheme which promised that young people leaving care would see much of their loan erased when they left college or university – in effect, converting it into grant – would be worth considering and would need a little bit of cash to make possible.

The affordability of the £58 million hinges of course on what happens at Westminster this May. NUS Scotland has welcomed the announcement and is gamely arguing the money should be found whatever, using new tax powers if necessary. But it’s hard to see that in the event of the Scottish government having to cope with the austerity programme of a further Conservative government that grants will be a priority against, say, childcare or the NHS. NUS Scotland continues to feed the situation in which it is regarded as politically toxic here to suggest that better off students might shoulder even a few thousand pounds more debt than now, to allow some of the cash subsidy for tuition to be moved into grant. If in the absence of a consequential, there’s no improvement in grants, the student movement will have played a role in that outcome (as they played a role in promoting the initial 2013 package, which implemented grant cuts, as a positive move).

Meantime, if Labour were to win the 2016 Holyrood election (not the bookmakers’ front-running outcome) they would still only be able to proceed if the money from the consequential hadn’t been tied up elsewhere by the time they got into office. While Nicola Sturgeon for the Scottish Government and Stewart Maxwell for the SNP were very quick to denounce the recent Labour announcement on fees, there are no quotes in any of the press articles about their reactions to the grant proposals. Once again, the government has managed to keep a low profile on this topic. Now we have this announcement, the Scottish government’s next move – it has still to announce grant rates for the coming academic year, NB – will be critical, in determining how likely it is that Scotland will start to correct the long-term inequalities embedded in its student funding system.